Life Insurance Corporation of India (LIC) IPO Message Board (Page 73)

As per RHP, HNI allotment is as per the old rule,



Policyholder allotment is also proportionate basis, so who apply max 13 lots will get first preference in allotment in this quota, maximum policyholder application size should be below 2 lacs.

Hi Gurus, one simple but tricky question. Is the price band 904-949 inclusive or 45 retail discount ? or will get 45 on this ? Please reply and explain if I am missing something here

After discount price will be 904 for retail category.

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Ok

If policy maturity date is 28/03/2022, will the person eligible for policyholders quota???

No. You are no longer policy holder on that date

I am applying this IPO and after sometime LIC need to reduced share percentage then will accumulate more.

for policy holders they giving 60 rupees discount, but for employees only 45 rupees - just like retail investor. is it correct? why?

Because whatever assets LIC owns is created from premium collected from policy holders

Hi,
I tried many times to apply IPO in HNI categiry but always some issues come. Also check with brokers but nobody sort out even they coudnt (ofcourse small brokers) today also ask with edelweiss he said will check with boss.
Any body if can help...
Thanking you.

What was the issue? Not understood from your message

Good Afternoon Everyone!

All are discussing about policyholder quota plus RII/HNI. Nobody is discussing anything about being eligible for three categories..... Policyholder plus Employee, and RII/HNI.

If you are employee and policy holder you can apply thrice

Few points deciding to subscribe this ipo.
1. For management Employees are not important as they have have given more edge to the policyholders than Employees. For policyholder discount is 60/ and for retail and Employees of the LIC is just Rs. 40/.
2. This is the second time when the govt is trying to float this ipo, earlier govt has fixed the ipo price above 2000/ . Now it is coming below Rs. 1000/ . Think the reasons what management had to reduce it's price band half of that earlier. Is it still high?
3. What LIC will get this from this IPO? All the funds will not be utilized by the LIC.
4. Remember the episode of Paytm before deciding.

Retail quota will likely remain undersubscribed because there will be significant overlap between policy holders and retailers & most policyholders will apply under Policyholder quote due to higher discount.

If you are looking for sureshot allotment, applying in retail is the best bet.

If you have more funds and are looking for allotment, HNI application in range of INR 2-10 lacs will also be almost sureshot allotment.

My personal opinion, pricing is on the lower side compared to peers. Despite being a govt company, around 20% listing gains are possible.

Best would be to wait till last day and apply in Retail/HNI depending on overall response.

Just checking - wouldn't policyholder and non-policy holder be part of the same retail quota. if so, how will applying as a non-policy holder be more beneficial?

No.

Total offer size is a.

Then you reduce employee reservation quota(b) and policyholder quota (c),

Then net offer size d = a-b-c.

35% of d is reserved for retail.

LIC, on course to its Rs 21,000-crore Initial Public Offer (IPO), aims at raising up to Rs 5,630 crore on the upper price band from anchor investors.
The IPO will be a pure offer for sale of up to 221.37 million shares. The firm reserved around 59.29 million shares for the anchor investor portion.
Employee reservation portion is at 1.58 million while policyholder reservation at 22.14 million. QIB portion set at 98.83 million.The anchor investment will open on May 2 and the IPO will open for subscription on May 4. It will close on 9 May. The basis of allotment will be on May 12 and shares will be credited on the demat accounts on May 16. The company plans to list on exchanges on May 17.
India's largest IPO, which slashed around 60 percent of its issue size due to poor market conditions, earlier announced its price band at Rs 902-949 a share.
With this, LIC will become the country's fifth most-valued listed firm, with a market cap of over Rs 6 trillion, Globally, it will rank 186th in terms of market cap.

I am still stuck up with 100 shares of MedPlus Health. Thinking of selling the same @ 1000 and buying LIC instead. Earlier sold another 50 of MedPlus and traded off with Ruchi Soya. It was a successful bargain.

If you are long investor then these shifting will not increase your wealth.

MedPlus have Pledge Share in March. so I don't this it will move fast. I have also sold MedPlus and buy AWL which works better for me.

Life Insurance Corporation of India IPO – Schedule *(Final – Pg# 562 of RHP)*

28th April – Announcement of Price Band
02nd May – Anchor Investors Allotment
04th May – Offer Opens
09th May – Offer Closes
12th May – Finalisation of Basis of Allotment
13th May – Unblocking of ASBA Accounts
16th May – Credit of Equity Shares to Depository Accounts
17th May – Commencement of Trading


Life Insurance Corporation of India IPO – Issue Information *(Final)*

Issue Opens on: 04 May 2022
Issue Closes on: 09 May 2022
Issue Type: Book Built Issue IPO
Issue Size: 22,13,74,920 Shares
Face Value: Rs.10/- per Share
Issue Price: Rs.902 – Rs.949 Share
Discount: Rs.45/- (for Employees & Retail) + Rs.60/- (for Policy Holders)
Market Lot: 15 Shares
Listing At: NSE, BSE

Equity Shares outstanding prior to the Issue = 6,32,49,97,701 Shares
Offer for Sale of 22,13,74,920 Shares @949/- = Rs.*20,557.23Crs
(*considering discount for Employees & Retail & Policyholders)
Equity Shares outstanding after the Issue = 6,32,49,97,701 Shares

Category-wise Break up:
Anchor – 5,92,96,853 Shares = 5,627.27Crs. (@949/-)
QIB – 3,95,31,236 Shares = 3,751.51Crs. (@949/-)
NII – 2,96,48,427 Shares = 2,813.64Crs. (@949/-)
RII – 6,91,79,663 Shares = 6253.84Crs (@904/-) (Lot size: 15 = 46,11,978 Forms)
Employees – 15,81,249 Shares = 142.94Crs. (@904/-)
PolicyHolders – 2,21,37,492 Shares = 1,968.02Crs. (@889/-)
Total Issue – 22,13,74,920 Shares = 20,557.23Crs.

Subscription required for 1X
RII = 46,11,978 Forms
NII = 2,813.64 Crs.


Life Insurance Corporation of India IPO – Financial Information (Basis of Valuation)

The information is collated from the following documents:
1) RHP = Draft Red Herring Prospectus Dated April 26, 2022 (663 pages)

EPS for FY18-19 >>> Rs 4.15 (Page #103 of RHP)
EPS for FY19-20 >>> Rs.4.29 (Page #103 of RHP)
EPS for FY20-21 >>> Rs.4.70 (Page #103 of RHP)
EPS for 9M21-22 >>> Rs.2.71 (Page #103 of RHP)

RoNW for FY18-19 >>> 322.25% (Page #104 of RHP)
RoNW for FY19-20 >>> 317.14% (Page #104 of RHP)
RoNW for FY20-21 >>> 45.65% (Page #104 of RHP)
RoNW for 9M21-22 >>> 20.84% (Page #104 of RHP)

NAV as on December 30, 2021 was Rs.13.01 (Page #104 of RHP)

Listed Industry Peer Group (Page #105 of RHP):
SBI Life Insurance Company,
HDFC Life Insurance Company,
ICICI Prudential Life Insurance Company


Life Insurance Corporation of India IPO – *Market’s Current Estimates of oversubscription*:

NII = 40KCrs. = ~14.22X
RII = 60L Forms = 1.63X Applic. wise (Avg allotment of ~9.22 shares per lot)

Interest cost *@7.00%p.a.* for 7days = *127.40 paise for 1X*

Thus, for NII the costing = 14.22 X 127.40 paise = Rs.18.11 per share (= GMP)

And, for RII the costing = 9.22 X 18.11 = Rs.167.06/- (= Kostak)

Life Insurance Corporation of India IPO – *GMP Estimated*

GMP 25 +/- 1
Kostak 230 +/- 10
Subject2 @350/-


LIC IPO

Issue Price = 1.112 X Embedded Value (as of Sept’21)
Market Cap = 1.112 X 5,39,686 Crs = 6,00,242Crs
Rate per Share = MarketCap ÷ No. of Outstanding Shares = 6,00,242Crs ÷ 6,32,49,97,701 = 949/-

Fair Value = 1.40 X Embedded Value (as of Sept’21)
Market Cap = 1.40 X 5,39,686 Crs = 7,55,560 Crs
Rate per Share = MarketCap ÷ No. of Outstanding Shares = 7,55,560 Crs ÷ 6,32,49,97,701 = 1,195/-


*LIC IPO*

*Comparison with Peer Group* 26/April

HDFC Life | CMP = 543.30 | No. of Shares = 2,11,26,19,161 | MCap = 1,14,779Crs. | Embedded Value = 30,048Crs. | MCap / EV = *3.820*

SBI Life | CMP = 1,066.35 | No. of Shares = 1,00,03,70,562 | MCap = 1,06,675Crs. | Embedded Value = 35,290Crs. | MCap / EV = *3.023*

ICICI Life | CMP = 517.40 | No. of Shares = 1,43,73,10,661 | MCap = 74,366Crs. | Embedded Value = 31,625Crs. | MCap / EV = *2.352*

And,
*LIC IPO | Issue Price = 949 *(FINAL)* | No. of Shares = 6,32,49,97,701 | MCap = 6,00,242Crs. | Embedded Value = 5,39,686Crs. | MCap / EV = 1.112*

What is the procedure to apply in zerodha in shareholder category? Do we have to input the policy number or is it taken automatically based on pan number registered with zerodha?

No need to enter policy number . If you link policy number with PAN before.

Just select policy holder category

Gmp 25

Life Insurance Corporation of India IPO

Date : 04-May to 09-May-2022
FV : Rs 10
Price : Rs 902 - Rs 949
Market Lot : 15 Shares
App Amt : Rs 14,235
Size : Rs 21,001.35 Cr
Retail : 35%
Retail Form : 4,611,978
EMP : 15,81,249 Shares
Policy : 2,21,37,492 Shares
Discount: Rs 60(Policy) ,Rs 45(Retail & EMP)
QIB : 50%
NII : 15%
Listing At : BSE, NSE

Registrar : KFin Tech
Allotment : 13-May-2022
Listing : 17-May-2022

Policy holder Quota will be oversubscribed as application wise but Applicants who will apply with 2 lakh is not more than 1.5 lakh.
Available lots around 14 lakh..

As per my calculations more than 5 lots will get atleast 1 lot surely and it will be increasing accordingly.

Please eloborate.I mean policy holder quota, employee quota etc also

LIC press conference start at 12:30

There are 3 queries
1)For LIC can I apply from Zerodha Policy Holder category and from Upstox Retail?
2)Can I apply from Zerodha for both category
3)I see May 2 is the revised date.Is that still true?

1) Yes
2) Yes
3) No. There has been no revision in record date. Record date for PolicyHolder (to hold/buy new policy) was 14-Feb-2022 and Record date to link Pan with Policy was 28-Feb-2022.

Is there any shareholder quota for LIC housing finance ltd share holders?

@JETHINDAS,
As per RHP page no. 569, there is no sharekholders quota in LIC IPO.

There is no parent company of LIC. LIC is owned by President of India so there will be no shareholder quota.

*Effective price in each category in LIC IPO:*

1. For HNIs 949/-

2. For QIBs 949/-

3. For Retail Investors 949-45 (Discount) = 904/-

4. For Policyholders 949-60 (Discount) = 889/-



*Investors can apply 2 App in LIC IPO on a single PAN Card*

Case 1: Policyholder + Retail

Case 2: Policyholder + HNI

*Eligibility for Policyholder Quota - RHP filing date*